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US economy set to boom in the next two years – leading macroeconomic influencers

31 Mar 2021 (Last Updated March 31st, 2021 10:14)

Federal Reserve policymakers remain optimistic about the US economy outlook.

US economy set to boom in the next two years – leading macroeconomic influencers
Credit: VectorMine, Shutterstock.com.

Federal Reserve policymakers remain optimistic about the US economy outlook, as an increasing number of citizens get vaccinated and government aid reaches households and businesses.

Pedro Nicolica da Costa

Pedro Nicolica da Costa, a Federal Reserve and economy correspondent at Market News International, retweeted an article on Federal policymakers remaining optimistic about the performance of the US economy.

According to Richmond Fed President, Thomas Barkin, the pandemic economy will pause just before taking off, as excess savings and fiscal stimulus funds will now be utilised by consumers and businesses alike, and with growing vaccinations and warmer weather. The Fed president believes that the economy’s growth and spending will remain strong through 2022 and 2023.

Atlanta Federal Reserve Bank President, Raphael Bostic, also stated that a burst of business activity during the summer could add a million jobs during the month. Economists have further predicted an addition of 650,000 jobs by the end of March 2021.

Rupa Subramanya

Rupa Subramanya, an economist, retweeted an article on how exports and the US stimulus will help bolster Vietnam’s economy. According to experts, while economies most exposed to the global merchandise trade would be most disadvantaged during the Covid-induced global recession, Vietnam is growing again because of a strong rise in exports. The country has also emerged as a clear winner in the US-China spat, making it a docking station for multistage trans-shipments to avoid American tariffs.

According to reports, the Southeast Asian nation’s first quarter GDP was up 4.5% compared to last year. It is being estimated that the recovery is driven by a surge in the sale of goods and services abroad, which rose to almost 20% year-over-year in March. It has been observed that sales to the US have dramatically risen and show no signs of slowing down. For instance, data reveals that US imports from Vietnam were about 29% of the Asian country’s total exports, far higher than the 20% average before 2019.

Economists state that although some of these gains may not be repeated, it is likely that the US share of Vietnam’s exports will remain high for some time. According to the Organisation for Economic Cooperation and Development (OECD), the domestic economic growth of 6-5% will keep US import demand strong for Vietnamese companies.

Diane Coyle

Professor Diane Coyle, an economist, retweeted an article on how self-employed workers in the UK have been the worst hit by the Covid-19 crisis. According to survey data, the latest lockdown imposed in January, has left self-employed workers with lower incomes and significantly reduced working hours.

Recent survey demonstrates that 14% of the self-employed quit their jobs in January 2021, up from September and May 2020. Another survey by the Centre for Economic Performance (CEP) survey found 37% of the self-employed working ten hours or less per week in January 2021, up 14 percentage points from August 2020.

In addition, 46% of the self-employed workers have had trouble paying for their basic expenses in January 2021. This is a rise from 29% in the summer but down from 33% during the first lockdown.

However, the government’s self-employment income support scheme (SEISS) has helped in holding up living standards of people as their earnings have consistently declined since the Covid outbreak.